A Useful Retirement Timeline for Each Decade of Your Life

A Useful Retirement Timeline for Each Decade of Your Life How much are you saving for retirement? We've put together a helpful timeline that outlines the most important steps you should take, for each decade of your life. Whether you're just kick starting your career or only a few years away from retirement, here's what you need to do to make sure you're on the right track. Save enough to your 401(k) to qualify for the company match (if they offer one). 401k FACT Missing out on the match could cost you $1,300/year on average. Your 20s SOURCE Financial Engines Supplement your employer's Free up more cash for retirement plan with a Roth IRA. savings by refinancing your student loans. FACT Saving just $50 a month from TIP age 25 to age 65 would add $128,000 to your nest egg! Check to see if your retirement plan contributions qualify you for the saver's tax credit, which is worth up to $1,000 for single 20-somethings. Bump up your 401(k) contributions by 1% each year. 2014 FACT 2015 A 1% yearly increase from age 30 to age 65 would add $15,000 to Your 30s Aim to invest 70% your retirement income annually. of your portfolio in stocks and the other 30% in bonds. Save at least six months' worth of CATCH-UP expenses so you're not tempted If you're late saving for to dip into your retirement in an retirement, save at least 15% emergency. of your income. Shift your portfolio to 55% stocks, 45% bonds. Your 40s Max out your retirement funds first before paying down high-interest debt. Consider downsizing your home or refinancing your mortgage to reduce your monthly expenses. FACT Refinancing a $200,000 mortgage to a rate that's 2% lower could reduce total interest charges by as much as 33%. SOURCE Freddie Mac CATCH-UP Double your vings to 30 of your income if you're lagging behind your target goal. Your 50s Weigh the advantages of Calculate how much you will get from delaying your benefits. Social Security. FACT FACT You'd get 132% of your As of 2015, the average monthly benefit for retirees monthly payout if you wait until was just under $1,300. age 70 to claim Social Security. SOURCE Social Security Administration Look into purchasing long-term care insurance to shield your retirement savings from being drained by health care costs. FACT IRA The average 65-year-old couple will spend nearly $270,000 on health care CATCH-UP For 2015, make catch-up contributions of $6,000 to a in retirement. 401(k) and $1,000 to an IRA if you're age 50 or older. SOURCE HealthView Services SOURCE IRS SOURCES Financial Engines corp.financialengines.com/docs/financial-engines-401k-match-report-050615.pdf Freddie Mac www.freddiemac.com/finance/pdf/refireport2013q4.pdf Social Security Information www.ssa.gov/policy/docs/quickfacts/stat_snapshot HealthView Services www.hvsfinancial.com/publicfiles/data release.pdf IRS www.irs.gov/retirement-plans/plan-participant,-employee/retirement-topics-catch-up-contributions %24 401(K) 31 %24